Pay attention to what small businesses do, not say

Posted November 10, 2011 at 2:18 pm

Via MarketMinder.com

Small businesses are a critical component of the US economy. They employ the majority of American workers, innovate, pay taxes and provide products and services critical to daily life.

So it makes sense economists and business groups attempt to put their finger on the pulse of American small business. One such effort, the National Federation of Independent Business (NFIB) Small Business Optimism Index, polls business owners as to their future plans for hiring, expansion, capital spending and general economic conditions.

In October 2011, NFIB found small business owners are, on average, rather glum. The index showed a minor improvement, gaining 1.3 points to 90.2—but that’s below the year-to-date average 91.1, and both are well below the index’s long-term average.

Sentiment regarding planned hiring was particularly dour—only 3% of net respondents indicate they expect to increase employment. In fact, the survey’s employment component has been mired in a range between -3% and +6% since positive private hiring data began in February 2010.

But over the same period, small and medium businesses led US job creation. ADP’s private hiring report indicates small and medium businesses have added 1,126,000 and 1,034,000 jobs, respectively—far eclipsing large employers’ hiring. So like consumer sentiment surveys, it seems watching what small business owners do in aggregate is more important than surveying what they say.

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Why Amazon.com’s stock could easily jump 20%

Posted November 7, 2011 at 12:49 am

by Dimitra Defotis

Next time you need a nice, big bag of alfalfa seeds, head right over to Barnes & Noble.

Quietly, Barnes & Noble’s Website has begun selling all manner of stuff—gardening supplies, high-end blenders, area rugs, you name it. Old-fashioned books and electronic Nooks are only part of the long-term game plan. Evidently, there will also be a place for $29.95 sacks of seeds.

If this strategy sounds familiar, it is. Online books pioneer Amazon.com (ticker: AMZN) is now thriving on products beyond the printed word—everything from kayaks to pearl necklaces. That stuff now accounts for more than half of its revenue.

BN.com is taking exactly the same route as Amazon, offering other sellers’ wares and taking a cut of the sales. It’s a complete copy-cat strategy, and for good reason: Amazon is the Internet bookseller to beat.

Scratch that. Amazon is the company to beat in all of Internet retailing. Barnes & Noble (BKS) is probably smart to follow the leader in these tumultuous times for books. The alternative, as Border’s learned, is to get trampled by the leader.

INVESTORS, TOO, SHOULD WISE UP to the extraordinary power of Amazon. They badly underestimated it last week after the [continue]….

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Dollar soars as gold posts losses

Posted November 2, 2011 at 12:57 am

by Chris Poindexter

The dollar surged against the Euro as the news surrounding the collapse of MF Global hit global markets like a sledge hammer. Equity markets around the world cratered and trading in grain futures was suspended in many countries, leaving traders holding positions they were suddenly unable to cover.

The European stock market lost over 3 percent in a single day, the U.S. Dow Jones Industrial Average was off 2.26 percent. Futures in U.S. equity markets point to more red ink today.

With the collapse in equities and the stalled trading in commodities, money flowed into the U.S. dollar, sending it sharply higher against the euro and the yen.

The rising dollar combined with interruptions in commodities trading sent precious metals and crude oil prices on a tumble of their own. Gold dipped below $1,700 this morning, dropping $26.94 to $1,687.31, while silver was down $2.00 to $32.20.

The collapse of MF Global revived memories of the collapse of Lehman Brothers in 2008, although it’s too soon at this point to know if there will be a ripple effect collapse of derivatives as there were in U.S. markets. Most experts do not think MF Global represents nearly the threat to markets that Lehman did in 2008.

The biggest problem will be organizing the return of customer assets, but first regulators have to find it. The New York Times reported earlier this week that customer money, supposedly segregated from the trading business, had gone missing.

Not to sound too much like a ghoulish harpy ready to capitalize on the misfortune of others, but the short-term turmoil in the markets could represent a prime buying opportunity for gold and silver collectors. With the commodities markets in turmoil short-term prices could fall even farther before returning to something resembling technicals.

Instead of trying to catch the proverbial falling knife, a series of small buys as prices continue to drop may be a better choice. If you’re planning on just adding to what’s already in your safe, then the timing isn’t as critical. Such obvious opportunities don’t come along in the market every day.

Chris Poindexter, Senior Writer, National Gold Group, Inc

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Homes selling for $100 down

Posted November 1, 2011 at 3:09 am

by Brian O’Connell

Got $100?

That’s enough for the Department of Housing and Urban Development to approve you to buy a new foreclosed home.

The deal isn’t good for everyone — just certain states are green-lit for the program — but the $100 down payment is a clear sign that the federal government is getting aggressive, maybe even desperate, to unload the foreclosed properties.

Insiders say the government is bracing for a new wave of foreclosed homes that were owned by Countrywide Mortgage, which was bought out by Bank of America. That alone could mean up to 40,000 new foreclosures on the market.

Here’s the deal:

From now until October 2012, consumers can plop down $100 and buy a HUD-owned foreclosed home (the previous minimum down payment amount was 3.5% of the home’s assessed value). If you buy, you have to actually live in the residence (that’s to discourage house flippers) and get financing for the home through the Federal Housing Administration.

There isn’t necessarily a discount on the home purchase, though, as HUD says buyers have to [continue]…

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Bullish sentiment jumps to a 6-month high

Posted October 31, 2011 at 2:33 am

by Charles Rotblut

Bullish sentiment, expectations that stock prices will rise over the next six months, reached a six-month high in the latest AAII Sentiment Survey. Optimism jumped 7.0 percentage points to 43.0%. This is the second time in three weeks that bullish sentiment has been above its historical average of 39%.

Neutral sentiment, expectations that stock prices will stay essentially unchanged over the next six months, rose 2.6 percentage points to 32.0%. This is the first time in 15 weeks that neutral sentiment has been above its historical average of 31%.

Bearish sentiment, expectations that stock prices will fall over the next six months, plunged 9.6 percentage points to 25.0%. This is the lowest level of pessimism since July 7, 2011. Bearish sentiment had been above its historical average of 30% for the previous 14 consecutive weeks.

This week’s numbers are a significant change from the trends we have seen. Bullish sentiment is above average for only the fifth time out of the last 28 weeks. Bearish sentiment is below average for only the fourth time in the past 36 weeks. The spread between bullish and bearish sentiment (the bull/bear spread) is the most positive it has been since February 17, 2011.

Whether this is a distinguishing change in sentiment or just a temporary shift remains to be seen. Pessimism has declined for five consecutive weeks as October’s rebound in stock prices has helped to calm nerves. On the other hand, individual investors remain concerned about [continue]…

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The U.S. is the best house on a bad block

Posted October 27, 2011 at 1:01 pm

by Jeff Macke

The conventional wisdom for at least the last five years for American investors is this: Go abroad to find returns. Emerging markets like Brazil, India, and China, and even Europe are the places to seek gains. The only choice for those preferring to invest locally is through American multi-nationals that create jobs overseas and keep the earnings abroad to avoid taxes.

Happily, for those of us clinging to the antiquated belief that America rocks, Paul Hickey, co-founder of Bespoke Investment Group, says the prevailing wisdom is wrong.

“After a ten year period of underperformance the U.S. started to bottom in late 2008 versus the rest of the world,” he says. “In the last year or two the U.S. has been vastly outperforming global peers.”

It gets even better for folks who are resentful of the multinationals refusing to repatriate and pay taxes on over $1,000,000,000,000 in overseas earnings. “Companies with more exposure overseas this year are doing much worse than U.S. companies (focused on domestic growth),” Hickey says.

In other words the closer U.S. investors get to home with their investments, the better off they may be. Among other catalysts for this, according to Hickey, is dollar strength. Though dollar weakness relative to the Euro is contributing to today’s powerful rally, Hickey notes the [continue]…

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California home sales + 6.7% in September

Posted October 18, 2011 at 12:45 am

by Paul A. Ebeling, Jnr

Bargain hunters snap up foreclosures, and the median home price continues to fall. California home sales picked up in September from the same month last year as prices came down.

Sales were up 6.7% as bargain hunters paying cash bought up foreclosures. Sales figures remained below the average for September in Southern California and the Bay Area, according to DataQuick, a real estate information service based in San Diego.

As is typical, sales were lower than in August, down 6.2%, for a total of 35,404 homes sold last month.

The median price for a home sold in California in September was [continue]…

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The most popular companies on Facebook

Posted October 17, 2011 at 1:45 am

by 24/7 Wall St.

Walmart announced a partnership today with the world’s largest social media service offering unique Facebook pages for 3,500 of its stores. The move, according to the world’s largest retailer, is an effort to bring more personal and relevant offers to its local shoppers and over 9 million Facebook fans.

Last month, Facebook surpassed 800 million users, which is nearly eight times as many people than watch the Super Bowl. Companies have recognized the importance of marketing to this massive group, and they are pulling out all the stops to try to get Facebook users to become “fans” of their corporate page. Using information gathered from All Facebook, 24/7 Wall St. has identified the 10 companies with the most Facebook fans.

In addition to the large number of people exposed to advertising, there are unique branding benefits to companies with successful Facebook pages. In a SocialMediaToday.com article, Keredy Stott writes “When a user likes a big brand, they are recommending the product to their friends, an element that isn’t usually visible when visiting a website. This support, whether the user realises it or not, helps to make their friends more likely to buy that product over a competitor’s.”

Presented with this valuable possibility, the world’s largest companies use every tactic in the book to get people to click the “like” button on their page. Retailers, like Kohl’s and Burberry, offer special deals or free products. Restaurants, such as McDonald’s and Subway, run contests on their Facebook pages. Many companies have turned their wall feed into a kind of direct support line for customer complaints.

Because they already have powerful brands, it makes sense that most of the largest consumer-based companies in the world have the largest Facebook pages. However, the social media efforts of some companies are far better than others. Kohl’s is only the 20th largest retailer in the U.S., but it has the second largest Facebook page among that group. By getting people to join its site, Kohl’s has gained a significant edge over its larger competitors, including Sears and Macy’s.

24/7 Wall St. used the All Facebook statistics site to identify the companies with the largest Facebook pages. The most recent annual revenue was used to illustrate the size of the companies. Valuations by Interbrand and Brand Z were used to demonstrate the brands’ reach.

These are the ten companies with the largest Facebook pages [continue]…

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Recession talk and increased auto shipments: like oil and water

Posted October 7, 2011 at 12:36 am

by Todd Sullivan

IF we enter a double dip, it will be the first time the US has ever done that with both increasing rail traffic and auto sales. Because of that, recession talk IMO, needs to be discounted even more especially given this data in conjunction with Sept auto sales coming in at 13.1M SAAR, GDP for Q2 being revised UP, ISM, ISI numbers still showing expansion and employment numbers grudgingly improving.

Total N. American rail traffic last week came in a 721K cars, up from 704K the week before and the highest levels since pre-Lehman 2008. In short, a GREAT number.

As for the “what” was shipped, auto shipments were the highest in over 2 years. Of the carriers, $CSX, $NSC, $BNI ($BRK.A), $KSU and $UNP all saw gains.

Here is the chart [continue]…

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Steve Jobs, the iconic tech visionary, dies at age 56

Posted October 5, 2011 at 6:14 pm

from Yahoo! Finance

Steve Jobs, who died on Wednesday, was a singular figure in American business history. He will go in the pantheon of great American entrepreneurs, inventors, and innovators, alongside John D. Rockefeller, Henry Ford, and Sam Walton.

Jobs didn’t invent computer technology, or the cell phone, or the notion of digitizing music. But he invented methods, business models, and devices that turned each into significantly larger cultural and economic phenomena.

To a degree, one might look back on the arc of Jobs’s career and conclude that he simply rode a series of technological waves. But Jobs, and the company he led, rode the waves while pushing back against them.

In an industry frequently hostile to design, Jobs’s Apple banked on it. In an industry in which products simply got cheaper every year and everything tends toward a commodity, Apple’s products were able to command a premium. And in an age of pinched consumer spending, millions of people were eager — even desperate — to shell out for the latest version of the iPod, the iPad, or the iPhone.

In an era frequently characterized by executive greed and massive pay for significant underperformance, Jobs worked for a [continue]….

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